FORM |
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |||||||
(Address of Principal Executive Offices) | (Zip Code) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
Large accelerated filer | o | x | |||||||||
Non-accelerated filer | o | Smaller reporting company | |||||||||
Emerging growth company |
RILEY EXPLORATION PERMIAN, INC. | ||||||||
FORM 10-Q | ||||||||
QUARTERLY REPORT ON FORM 10-Q FOR THE QUARTER ENDED MARCH 31, 2023 | ||||||||
TABLE OF CONTENTS | ||||||||
Page | ||||||||
Measurements. | |||||
Bbl | One barrel or 42 U.S. gallons liquid volume of oil or other liquid hydrocarbons | ||||
Boe | One stock tank barrel equivalent of oil, calculated by converting gas volumes to equivalent oil barrels at a ratio of 6 thousand cubic feet of gas to 1 barrel of oil and by converting NGL volumes to equivalent oil barrels at a ratio of 1 barrel of NGL to 1 barrel of oil | ||||
Boe/d | Stock tank barrel equivalent of oil per day | ||||
Btu | British thermal unit. One British thermal unit is the amount of heat required to raise the temperature of one pound of water by one degree Fahrenheit | ||||
MBbl | One thousand barrels of oil or other liquid hydrocarbons | ||||
MBoe | One thousand Boe | ||||
MBoe/d | One thousand Boe per day | ||||
Mcf | One thousand cubic feet of gas | ||||
MMcf | One million cubic feet of gas | ||||
Abbreviations. | |||||
ARO | Asset Retirement Obligation | ||||
CO2 | Carbon Dioxide | ||||
EOR | Enhanced Oil Recovery | ||||
FASB | Financial Accounting Standards Board | ||||
NGL | Natural gas liquids | ||||
NYSE | New York Stock Exchange | ||||
Oil | Crude oil and condensate | ||||
RRC | Railroad Commission of Texas | ||||
SEC | Securities and Exchange Commission | ||||
U.S. GAAP | Accounting principles generally accepted in the United States of America | ||||
WTI | West Texas Intermediate | ||||
RILEY EXPLORATION PERMIAN, INC. | ||||||||||||||
CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||||||||
(Unaudited) | ||||||||||||||
March 31, 2023 | December 31, 2022 | |||||||||||||
(In thousands, except share amounts) | ||||||||||||||
Assets | ||||||||||||||
Current Assets: | ||||||||||||||
Cash and cash equivalents | $ | $ | ||||||||||||
Accounts receivable | ||||||||||||||
Prepaid expenses and other current assets | ||||||||||||||
Inventory | ||||||||||||||
Current derivative assets | ||||||||||||||
Total current assets | ||||||||||||||
Oil and natural gas properties, net (successful efforts) | ||||||||||||||
Other property and equipment, net | ||||||||||||||
Non-current derivative assets | ||||||||||||||
Funds held in escrow | ||||||||||||||
Other non-current assets, net | ||||||||||||||
Total Assets | $ | $ | ||||||||||||
Liabilities and Shareholders' Equity | ||||||||||||||
Current Liabilities: | ||||||||||||||
Accounts payable | $ | $ | ||||||||||||
Accounts payable - related parties | ||||||||||||||
Accrued liabilities | ||||||||||||||
Revenue payable | ||||||||||||||
Current derivative liabilities | ||||||||||||||
Other current liabilities | ||||||||||||||
Total Current Liabilities | ||||||||||||||
Non-current derivative liabilities | ||||||||||||||
Asset retirement obligations | ||||||||||||||
Revolving credit facility | ||||||||||||||
Deferred tax liabilities | ||||||||||||||
Other non-current liabilities | ||||||||||||||
Total Liabilities | ||||||||||||||
Commitments and Contingencies (Note 12) | ||||||||||||||
Shareholders' Equity: | ||||||||||||||
Preferred stock, $ | ||||||||||||||
Common stock, $ | ||||||||||||||
Additional paid-in capital | ||||||||||||||
Retained earnings | ||||||||||||||
Total Shareholders' Equity | ||||||||||||||
Total Liabilities and Shareholders' Equity | $ | $ |
RILEY EXPLORATION PERMIAN, INC. | ||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||
(Unaudited) | ||||||||||||||
Three Months Ended March 31, | ||||||||||||||
2023 | 2022 | |||||||||||||
(In thousands, except per share amounts) | ||||||||||||||
Revenues: | ||||||||||||||
Oil and natural gas sales, net | $ | $ | ||||||||||||
Contract services - related parties | ||||||||||||||
Total Revenues | ||||||||||||||
Costs and Expenses: | ||||||||||||||
Lease operating expenses | ||||||||||||||
Production and ad valorem taxes | ||||||||||||||
Exploration costs | ||||||||||||||
Depletion, depreciation, amortization and accretion | ||||||||||||||
General and administrative: | ||||||||||||||
Administrative costs | ||||||||||||||
Share-based compensation expense | ||||||||||||||
Cost of contract services - related parties | ||||||||||||||
Transaction costs | ||||||||||||||
Total Costs and Expenses | ||||||||||||||
Income From Operations | ||||||||||||||
Other Income (Expense): | ||||||||||||||
Interest expense, net | ( | ( | ||||||||||||
Gain (loss) on derivatives | ( | |||||||||||||
Loss from equity method investment | ( | |||||||||||||
Total Other Income (Expense) | ( | |||||||||||||
Net Income (Loss) From Operations Before Income Taxes | ( | |||||||||||||
Income tax (expense) benefit | ( | |||||||||||||
Net Income (Loss) | $ | $ | ( | |||||||||||
Net Income (Loss) per Share: | ||||||||||||||
Basic | $ | $ | ( | |||||||||||
Diluted | $ | $ | ( | |||||||||||
Weighted Average Common Shares Outstanding: | ||||||||||||||
Basic | ||||||||||||||
Diluted |
RILEY EXPLORATION PERMIAN, INC. | ||||||||||||||||||||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY | ||||||||||||||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||||||||||||||
(In Thousands) | ||||||||||||||||||||||||||||||||
Shareholders' Equity | ||||||||||||||||||||||||||||||||
Three Months Ended March 31, 2023 | Common Stock | |||||||||||||||||||||||||||||||
Shares | Amount | Additional Paid-in Capital | Retained Earnings | Total Shareholders' Equity | ||||||||||||||||||||||||||||
Balance, December 31, 2022 | $ | $ | $ | $ | ||||||||||||||||||||||||||||
Share-based compensation expense | — | — | ||||||||||||||||||||||||||||||
Repurchased shares for tax withholding | ( | — | ( | — | ( | |||||||||||||||||||||||||||
Dividends declared | — | — | — | ( | ( | |||||||||||||||||||||||||||
Net income | — | — | — | |||||||||||||||||||||||||||||
Balance, March 31, 2023 | $ | $ | $ | $ | ||||||||||||||||||||||||||||
Shareholders' Equity | ||||||||||||||||||||||||||||||||
Three Months Ended March 31, 2022 | Common Stock | |||||||||||||||||||||||||||||||
Shares | Amount | Additional Paid-in Capital | Accumulated Deficit | Total Shareholders' Equity | ||||||||||||||||||||||||||||
Balance, December 31, 2021 | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||
Share-based compensation expense | — | — | — | |||||||||||||||||||||||||||||
Repurchased shares for tax withholding | ( | — | ( | — | ( | |||||||||||||||||||||||||||
Issuance of common shares under long-term incentive plan, net | — | — | — | — | ||||||||||||||||||||||||||||
Dividends declared | — | — | — | ( | ( | |||||||||||||||||||||||||||
Net loss | — | — | — | ( | ( | |||||||||||||||||||||||||||
Balance, March 31, 2022 | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||
RILEY EXPLORATION PERMIAN, INC. | ||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||||||||
(Unaudited) | ||||||||||||||
Three Months Ended March 31, | ||||||||||||||
2023 | 2022 | |||||||||||||
(In thousands) | ||||||||||||||
Cash Flows from Operating Activities: | ||||||||||||||
Net income (loss) | $ | $ | ( | |||||||||||
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||||||||||||||
Oil and gas lease expirations | ||||||||||||||
Depletion, depreciation, amortization and accretion | ||||||||||||||
(Gain) loss on derivatives | ( | |||||||||||||
Settlements on derivative contracts | ( | ( | ||||||||||||
Share-based compensation expense | ||||||||||||||
Deferred income tax expense | ( | |||||||||||||
Other | ||||||||||||||
Changes in operating assets and liabilities | ||||||||||||||
Accounts receivable | ( | |||||||||||||
Accounts receivable – related parties | ( | |||||||||||||
Prepaid expenses and other current assets | ( | |||||||||||||
Accounts payable and accrued liabilities | ( | |||||||||||||
Accounts payable - related parties | ||||||||||||||
Inventory | ( | |||||||||||||
Revenue payable | ||||||||||||||
Other current liabilities | ||||||||||||||
Net Cash Provided by Operating Activities | ||||||||||||||
Cash Flows from Investing Activities: | ||||||||||||||
Additions to oil and natural gas properties | ( | ( | ||||||||||||
Contributions to equity method investment | ( | |||||||||||||
Funds held in escrow | ( | |||||||||||||
Additions to other property and equipment | ( | ( | ||||||||||||
Net Cash Used in Investing Activities | ( | ( | ||||||||||||
Cash Flows from Financing Activities: | ||||||||||||||
Deferred financing costs | ( | ( | ||||||||||||
Proceeds from revolving credit facility | ||||||||||||||
Repayments under revolving credit facility | ( | |||||||||||||
Payment of common share dividends | ( | ( | ||||||||||||
Common stock repurchased for tax withholding | ( | ( | ||||||||||||
Net Cash Provided by (Used in) Financing Activities | ( | |||||||||||||
Net Increase (Decrease) in Cash and Cash Equivalents | ( | |||||||||||||
Cash and Cash Equivalents, Beginning of Period | ||||||||||||||
Cash and Cash Equivalents, End of Period | $ | $ | ||||||||||||
Supplemental Disclosure of Cash Flow Information | ||||||||||||||
Cash Paid For: | ||||||||||||||
Interest, net of capitalized interest | $ | $ | ||||||||||||
Income taxes | $ | $ | ||||||||||||
Non-cash Investing and Financing Activities: | ||||||||||||||
Changes in capital expenditures in accounts payable and accrued liabilities | $ | $ | ||||||||||||
Assets contributed to equity method investment | $ | $ |
March 31, 2023 | December 31, 2022 | ||||||||||
(In thousands) | |||||||||||
Oil, natural gas and NGL sales | $ | $ | |||||||||
Joint interest accounts receivable | |||||||||||
Other accounts receivable | |||||||||||
Total accounts receivable | $ | $ | |||||||||
March 31, 2023 | December 31, 2022 | ||||||||||
(In thousands) | |||||||||||
Deferred financing costs, net | $ | $ | |||||||||
Prepayments to outside operators | |||||||||||
Right of use assets | |||||||||||
Equity method investment | |||||||||||
Other deposits | |||||||||||
Total other non-current assets, net | $ | $ |
March 31, 2023 | December 31, 2022 | ||||||||||
(In thousands) | |||||||||||
Accrued capital expenditures | $ | $ | |||||||||
Accrued lease operating expenses | |||||||||||
Accrued general and administrative costs | |||||||||||
Accrued inventory | |||||||||||
Accrued ad valorem tax | |||||||||||
Other accrued expenditures | |||||||||||
Total accrued liabilities | $ | $ |
March 31, 2023 | December 31, 2022 | ||||||||||
(In thousands) | |||||||||||
Advances from joint interest owners | $ | $ | |||||||||
Income taxes payable | |||||||||||
Current ARO liabilities | |||||||||||
Lease liabilities | |||||||||||
Total other current liabilities | $ | $ |
March 31, 2023 | December 31, 2022 | ||||||||||
(In thousands) | |||||||||||
ARO, beginning balance | $ | $ | |||||||||
Liabilities incurred | |||||||||||
Revision of estimated obligations | |||||||||||
Liability settlements and disposals | ( | ( | |||||||||
Accretion | |||||||||||
ARO, ending balance | |||||||||||
Less: current ARO(1) | ( | ( | |||||||||
ARO, long-term | $ | $ |
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
(In thousands) | |||||||||||
Oil and natural gas sales: | |||||||||||
Oil | $ | $ | |||||||||
Natural gas | |||||||||||
Natural gas liquids | |||||||||||
Total oil and natural gas sales, net | $ | $ |
March 31, 2023 | December 31, 2022 | ||||||||||
(In thousands) | |||||||||||
Proved | $ | $ | |||||||||
Unproved | |||||||||||
Work-in-progress | |||||||||||
Accumulated depletion, amortization and impairment | ( | ( | |||||||||
Total oil and natural gas properties, net | $ | $ |
Weighted Average Price | ||||||||||||||||||||||||||
Calendar Quarter / Year | Notional Volume | Fixed | Put | Call | ||||||||||||||||||||||
($ per unit) | ||||||||||||||||||||||||||
Oil Swaps (Bbl) | ||||||||||||||||||||||||||
Q2 2023 | $ | $ | — | $ | — | |||||||||||||||||||||
Q3 2023 | $ | $ | — | $ | — | |||||||||||||||||||||
Q4 2023 | $ | $ | — | $ | — | |||||||||||||||||||||
2024 | $ | $ | — | $ | — | |||||||||||||||||||||
Natural Gas Swaps (Mcf) | ||||||||||||||||||||||||||
Q2 2023 | $ | $ | — | $ | — | |||||||||||||||||||||
Q3 2023 | $ | $ | — | $ | — | |||||||||||||||||||||
Q4 2023 | $ | $ | — | $ | — | |||||||||||||||||||||
2024 | $ | $ | — | $ | — | |||||||||||||||||||||
2025 | $ | $ | — | $ | — | |||||||||||||||||||||
Oil Collars (Bbl) | ||||||||||||||||||||||||||
Q2 2023 | $ | — | $ | $ | ||||||||||||||||||||||
Q3 2023 | $ | — | $ | $ | ||||||||||||||||||||||
Q4 2023 | $ | — | $ | $ | ||||||||||||||||||||||
2024 | $ | — | $ | $ | ||||||||||||||||||||||
2025 | $ | — | $ | $ | ||||||||||||||||||||||
Natural Gas Collars (Mcf) | ||||||||||||||||||||||||||
Q2 2023 | $ | — | $ | $ | ||||||||||||||||||||||
Q3 2023 | $ | — | $ | $ | ||||||||||||||||||||||
Q4 2023 | $ | — | $ | $ | ||||||||||||||||||||||
2024 | $ | — | $ | $ | ||||||||||||||||||||||
2025 | $ | — | $ | $ | ||||||||||||||||||||||
Oil Basis (Bbl) | ||||||||||||||||||||||||||
Q2 2023 | $ | $ | — | $ | — | |||||||||||||||||||||
Q3 2023 | $ | $ | — | $ | — | |||||||||||||||||||||
Q4 2023 | $ | $ | — | $ | — | |||||||||||||||||||||
2024 | $ | $ | — | $ | — |
March 31, 2023 | ||||||||||||||||||||
Balance Sheet Classification | Gross Fair Value | Amounts Netted | Net Fair Value | |||||||||||||||||
(In thousands) | ||||||||||||||||||||
Current derivative assets | $ | $ | ( | $ | ||||||||||||||||
Non-current derivative assets | ( | |||||||||||||||||||
Current derivative liabilities | ( | ( | ||||||||||||||||||
Non-current derivative liabilities | ( | ( | ||||||||||||||||||
Total | $ | ( | $ | — | $ | ( | ||||||||||||||
December 31, 2022 | ||||||||||||||||||||
Balance Sheet Classification | Gross Fair Value | Amounts Netted | Net Fair Value | |||||||||||||||||
(In thousands) | ||||||||||||||||||||
Current derivative assets | $ | $ | ( | $ | ||||||||||||||||
Non-current derivative assets | ( | |||||||||||||||||||
Current derivative liabilities | ( | ( | ||||||||||||||||||
Non-current derivative liabilities | ( | ( | ||||||||||||||||||
Total | $ | ( | $ | — | $ | ( |
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
(In thousands) | |||||||||||
Settlements on derivative contracts | $ | ( | $ | ( | |||||||
Non-cash gain (loss) on derivatives | ( | ||||||||||
Gain (loss) on derivatives | $ | $ | ( |
March 31, 2023 | |||||||||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||
Financial assets: | |||||||||||||||||||||||
Commodity derivative assets | $ | $ | $ | $ | |||||||||||||||||||
Financial liabilities: | |||||||||||||||||||||||
Commodity derivative liabilities | $ | $ | ( | $ | $ | ( | |||||||||||||||||
December 31, 2022 | |||||||||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||
Financial assets: | |||||||||||||||||||||||
Commodity derivative assets | $ | $ | $ | $ | |||||||||||||||||||
Financial liabilities: | |||||||||||||||||||||||
Commodity derivative liabilities | $ | $ | ( | $ | $ | ( | |||||||||||||||||
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
(In thousands) | |||||||||||
Combo | $ | $ | |||||||||
REG | |||||||||||
Contract services - related parties | $ | $ | |||||||||
Cost of contract services | $ | $ |
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
(In thousands) | |||||||||||
Interest expense | $ | $ | |||||||||
Capitalized interest | ( | ||||||||||
Amortization of deferred financing costs | |||||||||||
Unused commitment fees | |||||||||||
Total interest expense, net | $ | $ |
2021 Long-Term Incentive Plan | ||||||||||||||
Restricted Shares | Weighted Average Grant Date Fair Value | |||||||||||||
Unvested at December 31, 2022 | $ | |||||||||||||
Granted | $ | |||||||||||||
Vested | ( | $ | ||||||||||||
Forfeited | ( | $ | ||||||||||||
Unvested at March 31, 2023 | $ | |||||||||||||
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
(In thousands) | |||||||||||
Current income tax expense: | |||||||||||
Federal | $ | $ | |||||||||
State | |||||||||||
Total current income tax expense | $ | $ | |||||||||
Deferred income tax expense (benefit): | |||||||||||
Federal | $ | $ | ( | ||||||||
State | |||||||||||
Total deferred income tax expense (benefit) | $ | $ | ( | ||||||||
Total income tax expense (benefit) | $ | $ | ( |
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
(In thousands) | |||||||||||
Tax at statutory rate | % | % | |||||||||
Nondeductible compensation | % | ( | % | ||||||||
Share-based compensation | ( | % | % | ||||||||
State income taxes, net of federal benefit | % | % | |||||||||
Effective income tax rate | % | % |
Three Months Ended March 31, | ||||||||||||||
2023 | 2022 | |||||||||||||
(In thousands, except per share) | ||||||||||||||
Net income (loss) | $ | $ | ( | |||||||||||
Basic weighted-average common shares outstanding | ||||||||||||||
Restricted shares | ||||||||||||||
Diluted weighted average common shares outstanding | ||||||||||||||
Basic net income (loss) per common share | $ | $ | ( | |||||||||||
Diluted net income (loss) per share | $ | $ | ( |
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
Restricted shares |
Three Months Ended March 31, | ||||||||||||||
2023 | 2022 | |||||||||||||
Revenues (in thousands): | ||||||||||||||
Oil sales | $ | 64,974 | $ | 62,376 | ||||||||||
Natural gas sales | 523 | 1,789 | ||||||||||||
Natural gas liquids sales | 915 | 2,480 | ||||||||||||
Oil and natural gas sales, net | $ | 66,412 | $ | 66,645 | ||||||||||
Production Data, net: | ||||||||||||||
Oil (MBbls) | 893 | 675 | ||||||||||||
Natural gas (MMcf) | 949 | 682 | ||||||||||||
Natural gas liquids (MBbls) | 134 | 93 | ||||||||||||
Total (MBoe) | 1,185 | 881 | ||||||||||||
Daily combined volumes (Boe/d) | 13,169 | 9,791 | ||||||||||||
Daily oil volumes (Bbls/d) | 9,922 | 7,497 | ||||||||||||
Average Realized Prices: | ||||||||||||||
Oil ($ per Bbl) | $ | 72.76 | $ | 92.44 | ||||||||||
Natural gas ($ per Mcf) | 0.55 | 2.62 | ||||||||||||
Natural gas liquids ($ per Bbl) | 6.83 | 26.71 | ||||||||||||
Combined ($ per Boe) | $ | 56.04 | $ | 75.63 | ||||||||||
Average Realized Prices, including derivative settlements:(1) | ||||||||||||||
Oil ($ per Bbl) | $ | 67.06 | $ | 66.60 | ||||||||||
Natural gas ($ per Mcf) | 0.55 | 1.25 | ||||||||||||
Natural gas liquids ($ per Bbl) | 6.83 | 26.71 | ||||||||||||
Combined ($ per Boe) | $ | 51.74 | $ | 54.78 |
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
(In thousands) | |||||||||||
Contract services - related parties(1) | $ | 600 | $ | 600 | |||||||
Cost of contract services - related parties(2) | 110 | 85 | |||||||||
Gross profit from contract services | $ | 490 | $ | 515 | |||||||
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
Costs and Expenses: | (In thousands) | ||||||||||
Lease operating expenses | $ | 8,875 | $ | 6,830 | |||||||
Production and ad valorem taxes | $ | 4,110 | $ | 3,502 | |||||||
Exploration costs | $ | 332 | $ | 1,498 | |||||||
Depletion, depreciation, amortization and accretion | $ | 9,083 | $ | 6,633 | |||||||
Administrative costs | $ | 5,467 | $ | 4,014 | |||||||
Share-based compensation | 1,114 | 1,017 | |||||||||
General and administrative expense | $ | 6,581 | $ | 5,031 | |||||||
Transaction costs | $ | 1,887 | $ | 2,638 | |||||||
Interest expense, net | $ | 1,016 | $ | 678 | |||||||
(Gain) loss on derivatives | $ | (5,755) | $ | 49,632 | |||||||
Loss from equity method investment | $ | 232 | $ | — | |||||||
Income tax expense (benefit) | $ | 8,690 | $ | (2,114) |
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
(In thousands, except acreage data) | |||||||||||
Exploration expense(1) | $ | 332 | $ | 1,465 | |||||||
Geological and geophysical costs | — | 33 | |||||||||
Total exploration expense | $ | 332 | $ | 1,498 | |||||||
Expired net acres - Texas | 157 | 626 | |||||||||
Expired net acres - New Mexico | — | 518 | |||||||||
Net acres renewed after expiration(2) | — | 8 |
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
(In thousands) | |||||||||||
Settlements on derivative contracts | $ | (5,088) | $ | (18,375) | |||||||
Non-cash gain (loss) on derivatives | 10,843 | (31,257) | |||||||||
Gain (loss) on derivatives | $ | 5,755 | $ | (49,632) |
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
(In thousands) | |||||||||||
Current income tax expense | $ | 3,407 | $ | 779 | |||||||
Deferred income tax expense (benefit) | 5,283 | (2,893) | |||||||||
Total income tax expense (benefit) | $ | 8,690 | $ | (2,114) | |||||||
Effective income tax rate | 21.4 | % | 22.9 | % |
Three Months Ended March 31, | ||||||||||||||
2023 | 2022 | |||||||||||||
(In thousands) | ||||||||||||||
Statement of Cash Flows Data from Continuing Operations: | ||||||||||||||
Net cash provided by operating activities | $ | 32,970 | $ | 29,995 | ||||||||||
Net cash used in investing activities | $ | (69,935) | $ | (10,199) | ||||||||||
Net cash provided by (used in) financing activities | $ | 25,939 | $ | (8,504) |
Exhibit Number | Description | ||||
Agreement and Plan of Merger, by and among Tengasco, Inc., Antman Sub, LLC, and Riley Exploration - Permian, LLC, dated as of October 21, 2020 (incorporated by reference from Exhibit 2.1 to the Registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on October 22, 2020). | |||||
Amendment No. 1 to Agreement and Plan of Merger, by and among Tengasco, Inc., Antman Sub, LLC, and Riley Exploration - Permian, LLC, dated as of January 20, 2021 (incorporated by reference from Exhibit 2.1 to the Registrant’s Current Report on Form 8-K, as filed with the Securities and Exchange Commission on January 22, 2021). | |||||
First Amended and Restated Certificate of Incorporation of Riley Exploration Permian, Inc. (incorporated by reference to Exhibit 4.1 to the Registrant’s Registration Statement on Form S-8 filed with the Securities and Exchange Commission on March 1, 2021, Registration No. 333-253750). | |||||
Third Amended and Restated Bylaws of Riley Exploration Permian, Inc. (incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on September 23, 2022). | |||||
Note Purchase Agreement, dates as of April 3, 2023, among Riley Exploration - Permian, LLC, as Issuer, Riley Exploration Permian, Inc., as Parent, each of the subsidiaries of the Issuer party thereto as guarantors, each of the holders from time to time party thereto, and U.S. Bank Trust Company, National Association, as agent for the holders (incorporated by reference to Exhibit 4.1 to the Registrant's Current Report on Form 8-K filed with the Securities and Exchange Commission on April 4, 2023). | |||||
Credit Agreement dated as of September 28, 2017, by and among Riley Exploration – Permian, LLC, as borrower, Truist Bank, as administrative agent, and the lenders party thereto (incorporated by reference from Exhibit 10.1 to the Registrant’s Registration Statement on Form S-4/A, as filed with the Securities and Exchange Commission on December 31, 2020, Registration No. 333-250019). | |||||
First Amendment to Credit Agreement dated as of February 27, 2018, by and among Riley Exploration – Permian, LLC, as borrower, Truist Bank, as administrative agent, and the lenders party thereto (incorporated by reference from Exhibit 10.2 to the Registrant’s Registration Statement on Form S-4/A, as filed with the Securities and Exchange Commission on December 31, 2020, Registration No. 333-250019). | |||||
Second Amendment to Credit Agreement dated as of November 9, 2018, by and among Riley Exploration – Permian, LLC, as borrower, Truist Bank, as administrative agent, and the lenders party thereto (incorporated by reference from Exhibit 10.3 to the Registrant’s Registration Statement on Form S-4/A, as filed with the Securities and Exchange Commission on December 31, 2020, Registration No. 333-250019). | |||||
Third Amendment to Credit Agreement dated as of April 3, 2019, by and among Riley Exploration – Permian, LLC, as borrower, Truist Bank, as administrative agent, and the lenders party thereto (incorporated by reference from Exhibit 10.4 to the Registrant’s Registration Statement on Form S-4/A, as filed with the Securities and Exchange Commission on December 31, 2020, Registration No. 333-250019). | |||||
Fourth Amendment to Credit Agreement dated as of October 15, 2019, by and among Riley Exploration – Permian, LLC, as borrower, Truist Bank, as administrative agent, and the lenders party thereto (incorporated by reference from Exhibit 10.5 to the Registrant’s Registration Statement on Form S-4/A, as filed with the Securities and Exchange Commission on December 31, 2020, Registration No. 333-250019). | |||||
Fifth Amendment to Credit Agreement dated as of May 7, 2020, by and among Riley Exploration – Permian, LLC, as borrower, Truist Bank, as administrative agent, and the lenders party thereto (incorporated by reference from Exhibit 10.6 to the Registrant’s Registration Statement on Form S-4/A, as filed with the Securities and Exchange Commission on December 31, 2020, Registration No. 333-250019). | |||||
Sixth Amendment to Credit Agreement dated as of August 31, 2020, by and among Riley Exploration – Permian, LLC, as borrower, Truist Bank, as administrative agent, and the lenders party thereto (incorporated by reference from Exhibit 10.7 to the Registrant’s Registration Statement on Form S-4/A, as filed with the Securities and Exchange Commission on December 31, 2020, Registration No. 333-250019). |
Seventh Amendment and Consent to Credit Agreement dated as of October 21, 2020, by and among Riley Exploration – Permian, LLC, as borrower, Truist Bank, as administrative agent, and the lenders party thereto (incorporated by reference from Exhibit 10.8 to the Registrant’s Registration Statement on Form S-4/A, as filed with the Securities and Exchange Commission on December 31, 2020, Registration No. 333-250019). | |||||
Eighth Amendment to Credit Agreement dated as of March 5, 2021, by and among Riley Exploration Permian, Inc., Riley Exploration - Permian, LLC, as borrower, Truist Bank, as administrative agent, and the lenders party thereto (incorporated by reference from Exhibit 10.9 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2021, as filed with the Securities and Exchange Commission on May 17, 2021). | |||||
Ninth Amendment to Credit Agreement dated as of May 5, 2021, by and among Riley Exploration Permian, Inc., Riley Exploration - Permian, LLC, as borrower, Truist Bank, as administrative agent, and the lenders party thereto (incorporated by reference from Exhibit 10.10 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2021, as filed with the Securities and Exchange Commission on May 17, 2021). | |||||
Tenth Amendment to the Credit Agreement dated as of October 12, 2021, by and among Riley Exploration Permian, Inc., Riley Exploration - Permian, LLC, as borrower, Truist Bank, as administrative agent, and the lenders party thereto (incorporated by reference from Exhibit 10.1 to the Registrant’s Current Report on Form 8-K, as filed with the Securities and Exchange Commission on October 14, 2021). | |||||
Form of Indemnity Agreement (incorporated by reference from Exhibit 10.14 to the Registrant’s Registration Statement on Form S-4/A, as filed with the Securities and Exchange Commission on January 21, 2021, Registration No. 333-250019). | |||||
Form of Independent Director Agreement (incorporated by reference from Exhibit 10.13 to the Registrant’s Registration Statement on Form S-4/A, as filed with the Securities and Exchange Commission on January 21, 2021, Registration No. 333-250019). | |||||
Riley Exploration Permian, Inc. 2021 Long Term Incentive Plan (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the Commission on February 25, 2021). | |||||
Form of Common Stock Award Agreement (incorporated by reference from Exhibit 10.10 to the Registrant’s Current Report on Form 8-K, as filed with the Securities and Exchange Commission on March 15, 2021). | |||||
Form of Restricted Stock Agreement (Time Vesting) (incorporated by reference to Exhibit 4.4 to the Registrant’s Registration Statement on Form S-8, as filed with the Securities and Exchange Commission on March 1, 2021, Registration No. 333- 253750). | |||||
Form of Substitute Restricted Stock Agreement (Time Vesting) (incorporated by reference from Exhibit 4.5 to the Registrant’s Registration Statement on Form S-8 filed with the Commission on March 1, 2021, Registration No. 333-253750). | |||||
Form of Restricted Stock Agreement (Non-Employee Director) (incorporated by reference from Exhibit 4.6 to the Registrant’s Registration Statement on Form S-8 filed with the Commission on March 1, 2021, Registration No. 333-253750). | |||||
Employment Agreement dated effective as of March 15, 2021 by and between Riley Exploration Permian, Inc. and Corey Riley (incorporated by reference from Exhibit 10.1 to the Registrant’s Current Report on Form 8-K, as filed with the Securities and Exchange Commission on March 15, 2021). | |||||
10.20† | Employment Agreement dated effective as of March 15, 2021 by and between Riley Exploration Permian, Inc. and Philip Riley (incorporated by reference from Exhibit 10.2 to the Registrant’s Current Report on Form 8-K, as filed with the Securities and Exchange Commission on March 15, 2021). | ||||
Employment Agreement dated April 1, 2019 by and between Riley Exploration – Permian, LLC and Bobby D. Riley and assigned by Riley Exploration – Permian, LLC to Riley Permian Operating Company, LLC on June 8, 2019 (incorporated by reference from Exhibit 10.9 to the Registrant’s Registration Statement on Form S-4/A, as filed with the Securities and Exchange Commission on December 31, 2020, Registration No. 333-250019). | |||||
Amendment No. 1 to Employment Agreement dated October 1, 2020 by and between Riley Permian Operating Company, LLC and Bobby D. Riley (incorporated by reference from Exhibit 10.10 to the Registrant’s Registration Statement on Form S-4/A, as filed with the Securities and Exchange Commission on December 31, 2020, Registration No. 333-250019). |
Amendment No. 2 to Employment Agreement dated March 15, 2021 by and between Riley Permian Operating Company, LLC and Bobby D. Riley (incorporated by reference from Exhibit 10.7 to the Registrant’s Current Report on Form 8-K, as filed with the Securities and Exchange Commission on March 15, 2021). | |||||
Employment Agreement dated April 1, 2019 by and between Riley Exploration – Permian, LLC and Kevin Riley and assigned by Riley Exploration – Permian, LLC to Riley Permian Operating Company, LLC on June 8, 2019 (incorporated by reference from Exhibit 10.11 to the Registrant’s Registration Statement on Form S-4/A, as filed with the Securities and Exchange Commission on December 31, 2020, Registration No. 333-250019) | |||||
Amendment No. 1 to Employment Agreement dated March 15, 2021 by and between Riley Permian Operating Company, LLC and Kevin Riley (incorporated by reference from Exhibit 10.8 to the Registrant’s Current Report on Form 8-K, as filed with the Securities and Exchange Commission on March 15, 2021). | |||||
Second Amended and Restated Registration Rights Agreement dated October 7, 2020 by and among Riley Exploration – Permian, LLC, Riley Exploration Group, Inc., Yorktown Energy Partners XI, L.P., Boomer Petroleum, LLC, Bluescape Riley Exploration Holdings LLC, Bluescape Riley Acquisition Company LLC, Bobby D. Riley, Kevin Riley and Corey Riley (incorporated by reference to Exhibit 4.1 to the Registrant’s Registration Statement on Form S-4/A, as filed with the Securities and Exchange Commission on December 31, 2020, Registration No. 333-250019). | |||||
Employment Agreement dated effective as of January 25, 2022 by and between Riley Exploration Permian, Inc. and Amber Bonney (incorporated by reference from Exhibit 10.2 to the Registrant’s Current Report on Form 8-K, as filed with the Securities and Exchange Commission on January 27, 2022). | |||||
Eleventh Amendment to the Credit Agreement dated as of April 29, 2022, by and among Riley Exploration Permian, Inc., Riley Exploration - Permian, LLC, as borrower, Truist Bank, as administrative agent, and the lenders party thereto (incorporated by reference from Exhibit 10.1 to the Registrant's Current Report on Form 8-K, as filed with the Securities and Exchange Commission on May 2, 2022). | |||||
Twelfth Amendment to the Credit Agreement dated as of October 25, 2022, by and among Riley Exploration Permian, Inc., Riley Exploration - Permian, LLC, as borrower, Truist Bank, as administrative agent, and the lenders party thereto (incorporated by reference from Exhibit 10.1 to the Registrant's Current Report on Form 8-K, as filed with the Securities and Exchange Commission on October 26, 2022). | |||||
Thirteenth Amendment to the Credit Agreement dated as of February 22, 2023, by and among Riley Exploration Permian, Inc., Riley Exploration - Permian, LLC, as borrower, Truist Bank, as administrative agent, and the lenders party thereto (incorporated by reference from Exhibit 10.2 to the Registrant's Current Report on Form 8-K, as filed with the Securities and Exchange Commission on February 27, 2023). | |||||
Purchase and Sale Agreement dated February 22, 2023 by and between Pecos Oil & Gas, LLC, as Seller, and Riley Exploration - Permian, LLC, as Purchaser (incorporated by reference from Exhibit 2.1 to the Registrant's Current Report on Form 8-K, as filed with the Securities and Exchange Commission on February 27, 2023). | |||||
Fourteenth Amendment to the Credit Agreement dated as of April 3, 2023, by and among Riley Exploration Permian, Inc., Riley Exploration - Permian, LLC, as borrower, Truist Bank, as administrative agent, and the lenders party thereto (incorporated by reference from Exhibit 10.1 to the Registrant's Current Report on Form 8-K, as filed with the Securities and Exchange Commission on April 4, 2023). | |||||
Riley Exploration Permian, Inc. 2021 Long Term Incentive Plan, as amended and restated as of April 21, 2023 (Incorporated by reference from Exhibit 10.1 to the Registrant's Current Report on Form 8-K, as filed with the Securities and Exchange Commission on April 24, 2023). | |||||
Form of Restricted Stock Agreement (Time Vesting - Named Executive Officers), as amended and restated as of April 21, 2023 (Incorporated by reference from Exhibit 10.2 to the Registrant's Current Report on Form 8-K, as filed with the Securities and Exchange Commission on April 24, 2023). | |||||
Form of Restricted Stock Agreement (Non-Employee Director), as amended and restated as of April 21, 2023 (Incorporated by reference from Exhibit 10.3 to the Registrant's Current Report on Form 8-K, as filed with the Securities and Exchange Commission on April 24, 2023). | |||||
Form of Common Stock Award Agreement, as amended and restated as of April 21, 2023 (Incorporated by reference from Exhibit 10.4 to the Registrant's Current Report on Form 8-K, as filed with the Securities and Exchange Commission on April 24, 2023). | |||||
Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | |||||
Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
Certification of Chief Executive Officer pursuant to 18 U.S.C., Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | |||||
Certification of Chief Financial Officer pursuant to 18 U.S.C., Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | |||||
101.INS* | XBRL Instance Document | ||||
101.SCH* | XBRL Taxonomy Extension Schema Document | ||||
101.CAL* | XBRL Taxonomy Calculation Linkbase Document | ||||
101.DEF* | XBRL Taxonomy Definition Linkbase Document | ||||
101.LAB* | XBRL Taxonomy Label Linkbase Document | ||||
101.PRE* | XBRL Taxonomy Presentation Linkbase Document |
RILEY EXPLORATION PERMIAN, INC. | ||||||||
Date: May 10, 2023 | By: | /s/ Bobby D. Riley | ||||||
Bobby D. Riley | ||||||||
Chief Executive Officer | ||||||||
By: | /s/ Philip Riley | |||||||
Philip Riley | ||||||||
Chief Financial Officer |
CERTIFICATION |
Dated: | May 10, 2023 | |||||||
By: | /s/ Bobby Riley | |||||||
Bobby D. Riley | ||||||||
Chief Executive Officer |
CERTIFICATION |
Dated: | May 10, 2023 | |||||||
By: | /s/ Philip Riley | |||||||
Philip Riley | ||||||||
Chief Financial Officer |
CERTIFICATION |
Dated: | May 10, 2023 | |||||||
By: | /s/ Bobby Riley | |||||||
Bobby D. Riley | ||||||||
Chief Executive Officer |
CERTIFICATION |
Dated: | May 10, 2023 | |||||||
By: | /s/ Philip Riley | |||||||
Philip Riley | ||||||||
Chief Financial Officer |
CONDENSED CONSOLIDATED BALANCE SHEETS (PARENTHETICAL) - $ / shares |
Mar. 31, 2023 |
Dec. 31, 2022 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (USD per Share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized (in Shares) | 25,000,000 | 25,000,000 |
Preferred stock, shares issued (in Shares) | 0 | 0 |
Preferred stock, shares outstanding (in Shares) | 0 | 0 |
Common stock, par value (USD per Share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in Shares) | 240,000,000 | 240,000,000 |
Common stock, shares issued (in Shares) | 20,169,434 | 20,160,980 |
Common stock, shares outstanding (in Shares) | 20,169,434 | 20,160,980 |
Organization and Nature of Business |
3 Months Ended |
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Mar. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Nature of Business | Organization and Nature of Business Riley Permian is a growth-oriented, independent oil and natural gas company focused on the acquisition, exploration, development and production of oil, natural gas and NGL's in Texas and New Mexico. Our activities primarily include the horizontal development of the San Andres formation, a shelf margin deposit on the Northwest Shelf of the Permian Basin. Our acreage is primarily located on large, contiguous blocks in Yoakum County, Texas. On April 3, 2023 (the “Closing Date”), the Company completed its previously announced acquisition of oil and natural gas assets (the “New Mexico Acquisition”) from Pecos Oil & Gas, LLC (“Pecos”), a Delaware limited liability company and an affiliate of Cibolo Energy Partners LLC. These unaudited condensed consolidated financial statements and accompanying notes do not include the assets acquired or operating activity from the New Mexico Acquisition as the acquisition was completed in the second quarter of 2023. For further information regarding the New Mexico Acquisition, see Note 13 - Subsequent Events.
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Basis of Presentation |
3 Months Ended |
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Mar. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation Effective by the Company's Board of Directors written consent on September 23, 2022, the Company's fiscal year is now the period from January 1 to December 31, beginning with the year ended December 31, 2022. These unaudited condensed consolidated financial statements as of March 31, 2023 and for the three months ended March 31, 2023 and 2022 include the accounts of Riley Permian and its wholly owned subsidiaries and have been prepared in accordance with U.S. GAAP. All intercompany balances and transactions have been eliminated upon consolidation. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to the rules and regulations of the SEC. These condensed consolidated financial statements should be read in conjunction with the Company's Annual Report on Form 10-K for the year ended December 31, 2022. These condensed consolidated financial statements have not been audited by an independent registered public accounting firm. In the opinion of the Company’s management, the accompanying unaudited condensed consolidated financial statements contain all adjustments necessary for fair presentation of the results of operations for the periods presented, which adjustments were of a normal recurring nature, except as disclosed herein. The results of operations for the three months ended March 31, 2023 are not necessarily indicative of the results to be expected for the full fiscal year ending December 31, 2023, for various reasons, including as a result of the impact of fluctuations in prices received for oil and natural gas, natural production declines, the uncertainty of exploration and development drilling results, fluctuations in the fair value of derivative instruments, the current and future impacts of the military conflict between Russia and Ukraine, the volatile inflationary environment in U.S. markets and other factors.
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Summary of Significant Accounting Policies |
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Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Significant Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. These estimates and assumptions may also affect disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company evaluates these estimates on an ongoing basis, using historical experience, consultation with experts and other methods the Company considers reasonable in the particular circumstances. Actual results may differ significantly from the Company’s estimates. Any effects on the Company’s business, financial position or results of operations resulting from revisions to these estimates are recorded in the period in which the facts that give rise to the revision become known. Significant items subject to such estimates and assumptions include, but are not limited to, estimates of proved oil and natural gas reserves and related present value estimates of future net cash flows therefrom, the carrying value of oil and natural gas properties, accounts receivable, accrued capital expenditures and operating expenses, ARO, the fair value determination of acquired assets and assumed liabilities, certain tax accruals and the fair value of derivatives. Accounts Receivable Accounts receivable is summarized below:
The Company had no allowance for credit losses at March 31, 2023 and December 31, 2022. Other Non-Current Assets, Net Other non-current assets consisted of the following:
Equity method investment. In January 2023, the Company entered into an agreement to form a joint venture created for the purpose of constructing a new power infrastructure for onsite power generation in Yoakum County, Texas using produced natural gas. RPC Power Holdco LLC, a wholly owned subsidiary of REPX, has a 30% investment in the joint venture, RPC Power LLC ("RPC Power"). The Company will contribute its portion of capital expenditures for construction of the onsite power generation. As of March 31, 2023, the Company invested $4.1 million, comprised of $1.8 million in cash and $2.3 million of contributed assets, which was reduced by a $0.2 million loss during the three months ended March 31, 2023. The Company accounts for its corporate joint ventures under the equity method of accounting in accordance with FASB Accounting Standards Codification Topic 323 “Investments — Equity Method and Joint Ventures.” The Company applies the equity method of accounting to investments of less than 50% in an investee over which the Company exercises significant influence but does not have control. Under the equity method of accounting, the Company’s share of the investee’s earnings or loss is recognized in the condensed consolidated statement of operations. Judgment regarding the level of influence over each equity method investment includes considering key factors such as ownership interest, representation on the board of directors, participation in policy-making decisions, material intercompany transactions and extent of ownership by an investor in relation to the concentration of other shareholdings. Accrued Liabilities Accrued liabilities consisted of the following:
Other Current Liabilities Other current liabilities consisted of the following:
Asset Retirement Obligations Components of the changes in ARO consisted of the following and is shown below:
(1)Current ARO is included within other current liabilities on the accompanying condensed consolidated balance sheets. Revenue Recognition The following table presents oil and natural gas sales disaggregated by product:
Recent Accounting Pronouncements No new accounting pronouncements have been adopted or issued that would impact the financial statements of the Company.
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Oil and Natural Gas Properties |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Extractive Industries [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Oil and Natural Gas Properties | Oil and Natural Gas Properties Oil and natural gas properties are summarized below:
Depletion and amortization expense for proved oil and natural gas properties was $8.9 million and $6.4 million, respectively, for the three months ended March 31, 2023 and 2022. Exploration expense was $0.3 million and $1.5 million, respectively, for the three months ended March 31, 2023 and 2022. On April 3, 2023, the Company closed on an acquisition of oil and natural gas assets. Transaction costs associated with the acquisition were approximately $1.9 million for the three months ended March 31, 2023. In connection with the acquisition, a deposit of $33 million was paid by the Company and reflected as funds held in escrow on the condensed consolidated balance sheet as of March 31, 2023. For further information regarding the acquisition, see Note 13 - Subsequent Events.
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Derivative Instruments |
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Mar. 31, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments | Derivative Instruments Oil and Natural Gas Contracts The Company uses commodity based derivative contracts to reduce exposure to fluctuations in oil and natural gas prices. While the use of these contracts limits the downside risk for adverse price changes, their use also limits future revenues from favorable price changes. We have not designated our derivative contracts as hedges for accounting purposes, and therefore changes in the fair value of derivatives are included and recognized in other income (expense) in the condensed consolidated statement of operations. As of March 31, 2023, the Company's oil and natural gas derivative instruments consisted of fixed price swaps, costless collars, and basis protection swaps. The following table summarizes the open financial derivative positions as of March 31, 2023, related to oil and natural gas production:
Balance Sheet Presentation of Derivatives The following tables present the location and fair value of the Company’s derivative contracts included in the condensed consolidated balance sheets as of March 31, 2023 and December 31, 2022:
The following table presents the components of the Company's gain (loss) on derivatives for the periods presented below:
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Fair Value Measurements |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Measurements | Fair Value Measurements The FASB has established a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy consists of three broad levels. Level 1 inputs are the highest priority and consist of unadjusted quoted prices in active markets for identical assets and liabilities. Level 2 are inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly. Level 3 are unobservable inputs for an asset or liability. The carrying values of financial instruments comprising cash and cash equivalents, payables, receivables, and advances from joint interest owners approximate fair values due to the short-term maturities of these instruments and are classified as Level 1 in the fair value hierarchy. The carrying value reported for the revolving line of credit approximates fair value because the underlying instruments are at interest rates which approximate current market rates. The revolving line of credit is considered a Level 3 measurement. Assets and Liabilities Measured on a Recurring Basis The fair value of commodity derivatives are estimated using discounted cash flow calculations based upon forward curves and are classified as Level 2 in the fair value hierarchy. The following table presents the Company’s financial assets and liabilities that were accounted for at fair value on a recurring basis as of March 31, 2023 and December 31, 2022, by level within the fair value hierarchy:
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Transactions with Related Parties |
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Related Party Transactions [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Transactions with Related Parties | Transactions with Related Parties Contract Services Riley Permian Operating Company, LLC ("RPOC") provides certain administrative services to Combo Resources, LLC ("Combo") and is also the contract operator on behalf of Combo in exchange for a monthly fee of $100 thousand and reimbursement of all third party expenses pursuant to a contract services agreement. Additionally, RPOC provides certain administrative and operational services to Riley Exploration Group, LLC ("REG") in exchange for a monthly fee of $100 thousand pursuant to a contract services agreement. The following table presents revenues from and related cost for contract services for related parties:
The Company had amounts payable to Combo of $0.3 million and $0.4 million at March 31, 2023 and December 31, 2022, respectively, which are reflected in accounts payable - related parties, respectively, on the accompanying condensed consolidated balance sheets. Amounts due to Combo reflect the revenue, net of any expenditures for wells and fees due under the contract services agreement, for Combo's net working interest in wells that the Company operates on Combo's behalf. Consulting and Legal Fees The Company has an engagement agreement with di Santo Law PLLC ("di Santo Law"), a law firm owned by Beth di Santo, a member of our Board of Directors, pursuant to which di Santo Law's attorneys provide legal services to the Company. The Company incurred legal fees from di Santo Law of approximately $0.2 million for the three months ended March 31, 2023 and 2022. As of March 31, 2023 and December 31, 2022, the Company had approximately $20 thousand and zero in amounts accrued for di Santo Law, which was included in accounts payable - related parties in the accompanying condensed consolidated balance sheets.
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Long-Term Debt |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Long-Term Debt | Long-Term Debt As of March 31, 2023, Riley Exploration - Permian, LLC ("REP LLC"), as borrower, and the Company, as parent guarantor, are parties to a credit agreement with Truist Bank and certain lenders party thereto, as amended, which provides for a borrowing base of $225 million (such agreement and the borrowing facility provided thereby, the “Credit Facility”). On February 22, 2023, the Company amended its Credit Facility to, among other things, allow for the issuance of unsecured senior notes of up to $200 million. On April 3, 2023, the Company amended its Credit Facility to, among other things, increase the borrowing base from $225 million to $325 million and completed its issuance of $200 million Senior Unsecured Notes due 2028 ("Senior Notes"). For more information on the amended Credit Facility and the issuance of the Senior Notes, see Note 13 - Subsequent Events. The Credit Facility is set to mature in April 2026. Substantially all of the Company’s assets are pledged to secure the Credit Facility. The following table summarizes the Company's interest expense:
As of March 31, 2023 and December 31, 2022, the weighted average interest rate on outstanding borrowings under the revolving credit facility was 7.86% and 7.17%, respectively. As of March 31, 2023 and December 31, 2022, the Company was in compliance with all covenants and had outstanding borrowings of $89 million and $56 million, respectively, and $136 million and $169 million, respectively, available under the borrowing base.
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Shareholders' Equity |
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Equity [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Shareholders' Equity | Shareholders' Equity Dividends For the three months ended March 31, 2023 and 2022, the Company declared quarterly dividends on its common stock totaling approximately $6.9 million and $6.2 million, respectively. Equity-Based Compensation The Company's long-term equity incentive plan (the "2021 LTIP") had 1,387,022 shares of common stock available for issuance, of which 434,920 shares remained available as of March 31, 2023. Subsequent to March 31, 2023, an amendment and restatement of the 2021 LTIP was approved at the Company's annual meeting of stockholders held on April 21, 2023. For more information, see Note 13 - Subsequent Events. 2021 Long-Term Incentive Plan The following table presents the Company's restricted stock activity during the three months ended March 31, 2023 under the 2021 LTIP:
For the three months ended March 31, 2023 and 2022, the total equity-based compensation expense is $1.3 million and $1.0 million, respectively, for all periods and is included in general and administrative costs on the Company's condensed consolidated statement of operations for the restricted share awards granted under the 2021 LTIP. Approximately $7.6 million of additional equity-based compensation expense will be recognized over the weighted average life of 25 months for the unvested restricted share awards as of March 31, 2023 granted under the 2021 LTIP.
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Income Taxes |
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Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Taxes | Income Taxes The components of the Company's consolidated provision for income taxes from operations are as follows:
A reconciliation of the statutory federal income tax rate to the Company's effective income tax rate is as follows:
The Company's federal income tax returns for the years subsequent to December 31, 2018 remain subject to examination. The Company's income tax returns in major state income tax jurisdictions remain subject to examination for various periods subsequent to December 31, 2017. The Company currently believes that all other significant filing positions are highly certain and that all of its other significant income tax positions and deductions would be sustained under audit or the final resolution would not have a material effect on the consolidated financial statements. Therefore, the Company has not established any significant reserves for uncertain tax positions.
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Net Income (Loss) Per Share |
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Earnings Per Share [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Income (Loss) Per Share | Net Income (Loss) Per Share The Company calculated net income or loss per share using the treasury stock method. The table below sets forth the computation of basic and diluted net income (loss) per share for the periods presented below:
The following shares were excluded from the calculation of diluted net income (loss) per share due to their anti-dilutive effect for the periods presented:
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Commitments and Contingencies |
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Mar. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Indemnification The Company has agreed to indemnify its directors and certain of its officers, employees and agents with respect to claims and damages arising from acts or omissions taken in such capacity, as well as with respect to certain litigation. In the ordinary course of business, the Company enters into agreements that may include indemnification provisions. Pursuant to such agreements, the Company may indemnify, hold harmless and defend the indemnified parties for losses suffered or incurred by the indemnified party. Some of the provisions will limit losses to those arising from third-party actions. In some cases, the indemnification will continue after the termination of the agreement. The maximum potential amount of future payments the Company could be required to make under these provisions is not determinable. Legal Matters Due to the nature of the Company's business, the Company may at times be subject to claims and legal actions. The Company accrues liabilities when it is probable that future costs will be incurred, and such costs can be reasonably estimated. Such accruals are based on developments to date and the Company’s estimates of the outcomes of these matters. The Company did not recognize any material liability as of March 31, 2023 and December 31, 2022. Management believes it is remote that the impact of such matters will have a materially adverse effect on the Company’s financial position, results of operations, or cash flows. Environmental Matters The Company is subject to various federal, state and local laws and regulations relating to the protection of the environment. These laws, which are often changing, regulate the discharge of materials into the environment and may require the Company to remove or mitigate the environmental effects of the disposal or release of petroleum or chemical substances at various sites. The Company had no material environmental liabilities as of March 31, 2023 or December 31, 2022. Contractual Commitments In October 2021, the Company executed an agreement related to its EOR project. This agreement is a CO2 purchase agreement with Kinder Morgan CO2 Company, LLC that has a primary term extending through the earlier of the total contract quantity delivered or December 31, 2025. The agreement also has a daily contract quantity for Kinder Morgan to deliver CO2 to the Company. In August 2022, the Company entered into a second amendment on its gas gathering and processing agreement with its primary midstream counterparty, Stakeholder Midstream LLC (“Stakeholder”). Stakeholder committed to expand their gathering and processing system with a commitment from the Company to deliver an annual minimum volume to Stakeholder’s gathering system for a minimum of seven years beginning on the in-service date of the expanded plant. In January 2023, the Company entered into an agreement to form a joint venture with Conduit Power LLC. The Company is committed to contribute its portion of capital expenditures into the joint venture company, RPC Power. In conjunction with the formation of the joint venture, the Company entered into additional agreements with RPC Power or one of its subsidiaries. These agreements include RPC Power providing operational expertise on the implementation and management of the power generation for a monthly fee of $20 thousand and the Company committing to provide the natural gas needed to fuel the onsite power generators through 2028.
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Subsequent Events |
3 Months Ended |
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Mar. 31, 2023 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events New Mexico Acquisition On April 3, 2023 (the “Closing Date”), the Company completed its previously announced acquisition of oil and natural gas assets (the “New Mexico Acquisition”) from Pecos Oil & Gas, LLC (“Pecos”), a Delaware limited liability company and an affiliate of Cibolo Energy Partners LLC. The New Mexico Acquisition expands the Company's operations and adds significant drilling locations to the Company inventory. The aggregate purchase price of the New Mexico Acquisition is $330 million, subject to customary purchase price adjustments pursuant to the purchase and sale agreement (the “Purchase Agreement”), and was funded through a combination of borrowings under the Company's revolving credit facility and proceeds from the issuance of $200 million of Senior Notes. Due to the recent closing of the New Mexico Acquisition, the acquisition date fair value of the assets and liabilities of Pecos and certain other related disclosures were not yet available as of the date of this report. This acquisition will be accounted for as a business combination. Issuance of Senior Notes On the Closing Date, the Company (as “Issuer”) completed its issuance of $200 million aggregate principal amount of 10.50% Senior Unsecured Notes due 2028 pursuant to a note purchase agreement (the “Note Purchase Agreement”), which the Senior Notes were issued at a 6% discount. The net proceeds from the Senior Notes were used to fund a portion of the purchase price and related fees, costs and expenses for the New Mexico Acquisition. The Issuer may, at its option, redeem, at any time and from time to time on or prior to April 3, 2026, some or all of the Senior Notes at 100% of the principal amount thereof plus the make-whole amount plus a premium of 5.25% as set forth in the Note Purchase Agreement plus accrued and unpaid interest, if any. After April 3, 2026, but on or prior to October 3, 2026, the Issuer may, at its option, redeem, at any time and from time to time some or all of the Senior Notes at 100% of the principal amount thereof plus a premium of 5.25% as set forth in the Note Purchase Agreement plus accrued and unpaid interest, if any. After October 3, 2026, the Issuer may redeem some or all of the Senior Notes at 100% of the principal amount thereof plus accrued and unpaid interest, if any. The principal remaining outstanding at the time of maturity is required to be paid in full by the Issuer. The Senior Notes are general unsecured obligations ranking equally in right of payment with all other senior unsecured indebtedness of the Company and are senior in right of payment to all existing and future subordinated indebtedness of the Company. The Note Purchase Agreement contains customary terms and covenants, including limitations on the Company’s ability to incur additional secured and unsecured indebtedness. Amendment to Credit Facility On the Closing Date, the Company entered into the fourteenth amendment (the “Fourteenth Amendment”) to the Credit Facility to allow for the closing of the New Mexico Acquisition, including increasing the maximum facility amount to $1.0 billion and increasing the borrowing base to $325 million from $225 million and adding new lender parties to the syndicate, among other matters. The Company used borrowings from the Credit Facility to fund a portion of the purchase price and related fees, costs and expenses for the New Mexico Acquisition. Amendment and Restatement of the 2021 LTIP On April 21, 2023 at the Company's annual meeting of stockholders, the Company's stockholders approved the Amended and Restated 2021 Long Term Incentive Plan (the "A&R LTIP") that increased the total number of shares of Common Stock, par value $0.001 per share, by 950,000 shares that may be utilized for awards pursuant to the Plan from 1,387,022 to 2,337,022. The A&R LTIP is described in further detail in the Company's definitive proxy statement for the Annual Meeting filed with the Securities and Exchange Commission on March 22, 2023. Dividend Declaration On April 11, 2023, the Board of Directors of the Company declared a cash dividend of $0.34 per share of common stock payable on May 9, 2023 to its shareholders of record at the close of business on April 25, 2023.
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Summary of Significant Accounting Policies (Policies) |
3 Months Ended |
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Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
Consolidation | These unaudited condensed consolidated financial statements as of March 31, 2023 and for the three months ended March 31, 2023 and 2022 include the accounts of Riley Permian and its wholly owned subsidiaries and have been prepared in accordance with U.S. GAAP. All intercompany balances and transactions have been eliminated upon consolidation. |
Significant Estimates | Significant Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. These estimates and assumptions may also affect disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company evaluates these estimates on an ongoing basis, using historical experience, consultation with experts and other methods the Company considers reasonable in the particular circumstances. Actual results may differ significantly from the Company’s estimates. Any effects on the Company’s business, financial position or results of operations resulting from revisions to these estimates are recorded in the period in which the facts that give rise to the revision become known. Significant items subject to such estimates and assumptions include, but are not limited to, estimates of proved oil and natural gas reserves and related present value estimates of future net cash flows therefrom, the carrying value of oil and natural gas properties, accounts receivable, accrued capital expenditures and operating expenses, ARO, the fair value determination of acquired assets and assumed liabilities, certain tax accruals and the fair value of derivatives.
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Equity method investment | The Company accounts for its corporate joint ventures under the equity method of accounting in accordance with FASB Accounting Standards Codification Topic 323 “Investments — Equity Method and Joint Ventures.” The Company applies the equity method of accounting to investments of less than 50% in an investee over which the Company exercises significant influence but does not have control. Under the equity method of accounting, the Company’s share of the investee’s earnings or loss is recognized in the condensed consolidated statement of operations. Judgment regarding the level of influence over each equity method investment includes considering key factors such as ownership interest, representation on the board of directors, participation in policy-making decisions, material intercompany transactions and extent of ownership by an investor in relation to the concentration of other shareholdings. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements No new accounting pronouncements have been adopted or issued that would impact the financial statements of the Company.
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Summary of Significant Accounting Policies (Tables) |
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Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Accounts Receivable | Accounts receivable is summarized below:
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Schedule of Other Non-current Assets, Net | Other non-current assets consisted of the following:
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Schedule of Accrued Liabilities | Accrued liabilities consisted of the following:
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Schedule of Other Current Liabilities | Other current liabilities consisted of the following:
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Schedule of Asset Retirement Obligations | Components of the changes in ARO consisted of the following and is shown below:
(1)Current ARO is included within other current liabilities on the accompanying condensed consolidated balance sheets.
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Schedule of Disaggregation of Revenue | The following table presents oil and natural gas sales disaggregated by product:
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Oil and Natural Gas Properties (Tables) |
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Extractive Industries [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Oil and Gas Properties | Oil and natural gas properties are summarized below:
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Derivative Instruments (Tables) |
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Notional Amounts of Outstanding Derivative Positions | The following table summarizes the open financial derivative positions as of March 31, 2023, related to oil and natural gas production:
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Schedule of Derivative Instruments Location and Fair Value | The following tables present the location and fair value of the Company’s derivative contracts included in the condensed consolidated balance sheets as of March 31, 2023 and December 31, 2022:
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Schedule of Derivative Instruments, Gain (Loss) | The following table presents the components of the Company's gain (loss) on derivatives for the periods presented below:
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Fair Value Measurements (Tables) |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The following table presents the Company’s financial assets and liabilities that were accounted for at fair value on a recurring basis as of March 31, 2023 and December 31, 2022, by level within the fair value hierarchy:
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Transactions with Related Parties (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Related Party Transactions [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Related Party Transactions | The following table presents revenues from and related cost for contract services for related parties:
|
Long-Term Debt (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Components of Interest Expense | The following table summarizes the Company's interest expense:
|
Shareholders' Equity (Tables) |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Restricted Stock, Activity | The following table presents the Company's restricted stock activity during the three months ended March 31, 2023 under the 2021 LTIP:
|
Income Taxes (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Components of Income Tax Expense (Benefit) | The components of the Company's consolidated provision for income taxes from operations are as follows:
|
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Schedule of Effective Income Tax Rate Reconciliation | A reconciliation of the statutory federal income tax rate to the Company's effective income tax rate is as follows:
|
Net Income (Loss) Per Share (Tables) |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Computation of Basic and Diluted Net Loss Per Shares | The table below sets forth the computation of basic and diluted net income (loss) per share for the periods presented below:
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Anti-Dilutive Shares | The following shares were excluded from the calculation of diluted net income (loss) per share due to their anti-dilutive effect for the periods presented:
|
Summary of Significant Accounting Policies - Schedule of Accounts Receivable (Details) - USD ($) $ in Thousands |
Mar. 31, 2023 |
Dec. 31, 2022 |
---|---|---|
Accounting Policies [Abstract] | ||
Oil, natural gas and NGL sales | $ 23,804 | $ 24,136 |
Joint interest accounts receivable | 728 | 793 |
Other accounts receivable | 108 | 622 |
Total accounts receivable | $ 24,640 | $ 25,551 |
Summary of Significant Accounting Policies - Narrative (Details) - USD ($) |
3 Months Ended | |||
---|---|---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
Jan. 31, 2023 |
Dec. 31, 2022 |
|
Schedule of Equity Method Investments [Line Items] | ||||
Allowance for credit losses | $ 0 | $ 0 | ||
Equity method investment | 3,880,000 | $ 0 | ||
Contributions to equity method investment | 1,840,000 | $ 0 | ||
Assets contributed to equity method investment | 2,272,000 | 0 | ||
Loss from equity method investments | 232,000 | $ 0 | ||
RPC Power, LLC | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Equity method investment | 4,100,000 | |||
Contributions to equity method investment | 1,800,000 | |||
Assets contributed to equity method investment | 2,300,000 | |||
Loss from equity method investments | $ 200,000 | |||
RPC Power, LLC | RPC Power Holdco LLC | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Equity method investment, ownership percentage | 30.00% |
Summary of Significant Accounting Policies - Schedule of Other Non-current Assets, Net (Details) - USD ($) $ in Thousands |
Mar. 31, 2023 |
Dec. 31, 2022 |
---|---|---|
Accounting Policies [Abstract] | ||
Deferred financing costs, net | $ 2,413 | $ 2,556 |
Prepayments to outside operators | 2,193 | 186 |
Right of use assets | 1,232 | 1,370 |
Equity method investment | 3,880 | 0 |
Other deposits | 66 | 63 |
Total other non-current assets, net | $ 9,784 | $ 4,175 |
Summary of Significant Accounting Policies - Schedule of Accrued Liabilities (Details) - USD ($) $ in Thousands |
Mar. 31, 2023 |
Dec. 31, 2022 |
---|---|---|
Accounting Policies [Abstract] | ||
Accrued capital expenditures | $ 13,768 | $ 16,744 |
Accrued lease operating expenses | 2,267 | 4,607 |
Accrued general and administrative costs | 3,591 | 2,286 |
Accrued inventory | 210 | 6,235 |
Accrued ad valorem tax | 916 | 3,789 |
Other accrued expenditures | 766 | 1,921 |
Total accrued liabilities | $ 21,518 | $ 35,582 |
Summary of Significant Accounting Policies - Schedule of Other Current Liabilities (Details) - USD ($) $ in Thousands |
Mar. 31, 2023 |
Dec. 31, 2022 |
---|---|---|
Accounting Policies [Abstract] | ||
Advances from joint interest owners | $ 170 | $ 192 |
Income taxes payable | 4,601 | 1,194 |
Current ARO liabilities | 71 | 314 |
Lease liabilities | 540 | 538 |
Total other current liabilities | $ 5,382 | $ 2,238 |
Summary of Significant Accounting Policies - Schedule of Asset Retirement Obligations (Details) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended |
---|---|---|
Mar. 31, 2023 |
Dec. 31, 2022 |
|
Asset Retirement Obligation, Roll Forward Analysis [Roll Forward] | ||
ARO, beginning balance | $ 3,038 | $ 2,453 |
Liabilities incurred | 21 | 358 |
Revision of estimated obligations | 0 | 326 |
Liability settlements and disposals | (153) | (178) |
Accretion | 25 | 79 |
ARO, ending balance | 2,931 | 3,038 |
Less: current ARO | (71) | (314) |
ARO, long-term | $ 2,860 | $ 2,724 |
Summary of Significant Accounting Policies - Schedule of Revenue (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Disaggregation of Revenue [Line Items] | ||
Total Revenues | $ 67,012 | $ 67,245 |
Oil and natural gas sales, net | ||
Disaggregation of Revenue [Line Items] | ||
Total Revenues | 66,412 | 66,645 |
Oil | ||
Disaggregation of Revenue [Line Items] | ||
Total Revenues | 64,974 | 62,376 |
Natural gas | ||
Disaggregation of Revenue [Line Items] | ||
Total Revenues | 523 | 1,789 |
Natural gas liquids | ||
Disaggregation of Revenue [Line Items] | ||
Total Revenues | $ 915 | $ 2,480 |
Oil and Natural Gas Properties - Schedule of Oil and Gas Properties (Details) - USD ($) $ in Thousands |
Mar. 31, 2023 |
Dec. 31, 2022 |
---|---|---|
Extractive Industries [Abstract] | ||
Proved | $ 550,099 | $ 516,011 |
Unproved | 11,109 | 12,770 |
Work-in-progress | 54,273 | 45,169 |
Total oil and natural gas properties, gross | 615,481 | 573,950 |
Accumulated depletion, amortization and impairment | (142,759) | (133,848) |
Total oil and natural gas properties, net | $ 472,722 | $ 440,102 |
Oil and Natural Gas Properties - Narrative (Details) - USD ($) $ in Thousands |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
Dec. 31, 2022 |
|
Extractive Industries [Abstract] | |||
Depletion and amortization | $ 8,900 | $ 6,400 | |
Exploration costs | 332 | 1,498 | |
Transaction costs | 1,887 | $ 2,638 | |
Funds held in escrow | $ 33,000 | $ 0 |
Derivative Instruments - Schedule of Derivative Instruments, Gain (Loss) (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||
Settlements on derivative contracts | $ (5,088) | $ (18,375) |
Non-cash gain (loss) on derivatives | 10,843 | (31,257) |
Gain (loss) on derivatives | $ 5,755 | $ (49,632) |
Fair Value Measurements - Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis (Details) - Commodity derivative - USD ($) $ in Thousands |
Mar. 31, 2023 |
Dec. 31, 2022 |
---|---|---|
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Financial assets | $ 19,860 | $ 73 |
Financial liabilities | (25,481) | (16,537) |
Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Financial assets | 0 | 0 |
Financial liabilities | 0 | 0 |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Financial assets | 19,860 | 73 |
Financial liabilities | (25,481) | (16,537) |
Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Financial assets | 0 | 0 |
Financial liabilities | $ 0 | $ 0 |
Transactions with Related Parties - Narrative (Details) - USD ($) |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
Dec. 31, 2022 |
|
Legal Services | di Santo Law PLLC | Director | |||
Related Party Transaction [Line Items] | |||
Expenses with related parties | $ 200,000 | $ 200,000 | |
Due to related parties | 20,000 | $ 0 | |
Affiliated Entity | Contract Services Agreement | Combo Resources, LLC | |||
Related Party Transaction [Line Items] | |||
Monthly servicing fee | 100,000 | ||
Due from (to) related party | 300,000 | $ 400,000 | |
Affiliated Entity | Contract Services Agreement | Riley Exploration Group, Inc | |||
Related Party Transaction [Line Items] | |||
Monthly servicing fee | $ 100,000 |
Transactions with Related Parties - Schedule of Related Party Transactions (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Related Party Transaction [Line Items] | ||
Cost of contract services | $ 110 | $ 85 |
Affiliated Entity | Contract Services Agreement | ||
Related Party Transaction [Line Items] | ||
Contract services - related parties | 600 | 600 |
Affiliated Entity | Contract Services Agreement | Combo Resources, LLC | ||
Related Party Transaction [Line Items] | ||
Contract services - related parties | 300 | 300 |
Affiliated Entity | Contract Services Agreement | Riley Exploration Group, Inc | ||
Related Party Transaction [Line Items] | ||
Contract services - related parties | $ 300 | $ 300 |
Long-Term Debt - Narrative (Details) - USD ($) |
Apr. 03, 2023 |
Apr. 02, 2023 |
Mar. 31, 2023 |
Feb. 22, 2023 |
Dec. 31, 2022 |
---|---|---|---|---|---|
Line of Credit Facility [Line Items] | |||||
Outstanding borrowings | $ 89,000,000 | $ 56,000,000 | |||
Line of Credit | Revolving Credit Facility | |||||
Line of Credit Facility [Line Items] | |||||
Borrowing base | $ 225,000,000 | ||||
Weighted average interest rate | 7.86% | 7.17% | |||
Available under the credit facility | $ 136,000,000 | $ 169,000,000 | |||
Line of Credit | Revolving Credit Facility | Subsequent Event | |||||
Line of Credit Facility [Line Items] | |||||
Borrowing base | $ 325,000,000 | $ 225,000,000 | |||
Unsecured Debt | Revolving Credit Facility | |||||
Line of Credit Facility [Line Items] | |||||
Debt Instrument, face amount | $ 200,000,000 | ||||
Senior Notes | Subsequent Event | 10.50% Senior Unsecured Notes due 2028 | |||||
Line of Credit Facility [Line Items] | |||||
Debt Instrument, face amount | $ 200,000,000 |
Long-Term Debt - Components of Interest Expense (Details) - Line of Credit - Revolving Credit Facility - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Line of Credit Facility [Line Items] | ||
Interest expense | $ 1,294 | $ 384 |
Capitalized interest | (615) | 0 |
Amortization of deferred financing costs | 192 | 191 |
Unused commitment fees | 145 | 103 |
Total interest expense, net | $ 1,016 | $ 678 |
Shareholders' Equity - Narrative (Details) - USD ($) $ in Thousands |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
Dec. 31, 2022 |
|
Class of Stock [Line Items] | |||
Dividends on common stock | $ 6,900 | $ 6,200 | |
Common stock outstanding post merger (in Shares) | 20,169,434 | 20,160,980 | |
Share-based compensation expense | $ 1,114 | 1,017 | |
General and Administrative Expense | |||
Class of Stock [Line Items] | |||
Share-based compensation expense | $ 1,300 | $ 1,000 | |
2021 Long-Term Incentive Plan | |||
Class of Stock [Line Items] | |||
Common stock reserved for future issuance (in Shares) | 1,387,022 | ||
Common stock outstanding post merger (in Shares) | 434,920 | ||
2021 Long-Term Incentive Plan | Restricted Stock | |||
Class of Stock [Line Items] | |||
Additional equity-based compensation to be recognized | $ 7,600 | ||
Weighted average life | 25 months |
Shareholders' Equity - Schedule of Restricted Stock Units Activity (Details) - Restricted Stock - 2021 Long-Term Incentive Plan |
3 Months Ended |
---|---|
Mar. 31, 2023
$ / shares
shares
| |
Restricted Shares | |
Unvested, beginning balance (in Shares) | shares | 536,209 |
Granted (in Shares) | shares | 16,364 |
Vested (in Shares) | shares | (47,957) |
Forfeited (in Shares) | shares | (365) |
Unvested, ending balance (in Shares) | shares | 504,251 |
Weighted Average Grant Date Fair Value | |
Unvested, beginning balance (USD per Share) | $ / shares | $ 18.39 |
Granted (USD per Share) | $ / shares | 31.62 |
Vested (USD per Share) | $ / shares | 18.14 |
Forfeited (USD per Share) | $ / shares | 16.30 |
Unvested, ending balance (USD per Share) | $ / shares | $ 18.63 |
Income Taxes -Schedule of Components of Income Tax Expense (Benefit) (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Current income tax expense: | ||
Federal | $ 3,207 | $ 768 |
State | 200 | 11 |
Total current income tax expense | 3,407 | 779 |
Deferred income tax expense (benefit): | ||
Federal | 5,088 | (2,894) |
State | 195 | 1 |
Total deferred income tax expense (benefit) | 5,283 | (2,893) |
Total income tax expense (benefit) | $ 8,690 | $ (2,114) |
Income Taxes - Schedule of Effective Income Tax Rate Reconciliation (Details) |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Effective Income Tax Rate Reconciliation, Percent [Abstract] | ||
Tax at statutory rate | 21.00% | 21.00% |
Nondeductible compensation | 0.00% | (0.40%) |
Share-based compensation | (0.40%) | 1.90% |
State income taxes, net of federal benefit | 0.80% | 0.40% |
Effective income tax rate | 21.40% | 22.90% |
Net Income (Loss) Per Share - Schedule of Computation of Basic and Diluted Net Loss Per Shares (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Earnings Per Share [Abstract] | ||
Net income (loss) | $ 31,851 | $ (7,168) |
Basic weighted-average common shares outstanding (in Shares) | 19,649 | 19,501 |
Restricted shares (in Shares) | 261 | 0 |
Diluted weighted-average common shares outstanding (in Shares) | 19,910 | 19,501 |
Basic net income (loss) per common share (USD per Share) | $ 1.62 | $ (0.37) |
Diluted net income (loss) per common share (USD per Share) | $ 1.60 | $ (0.37) |
Net Income (Loss) Per Share - Schedule of Anti-Dilutive Shares (Details) - shares |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Restricted shares | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-dilutive securities (in Shares) | 246,358 | 332,725 |
Commitments and Contingencies (Details) - USD ($) |
1 Months Ended | |||
---|---|---|---|---|
Aug. 31, 2022 |
Mar. 31, 2023 |
Jan. 31, 2023 |
Dec. 31, 2022 |
|
Loss Contingencies [Line Items] | ||||
Environmental liabilities | $ 0 | $ 0 | ||
RPC Power, LLC | ||||
Loss Contingencies [Line Items] | ||||
Contractual obligation, monthly fee | $ 20,000 | |||
Stakeholder | ||||
Loss Contingencies [Line Items] | ||||
Purchase obligation, delivery period | 7 years |
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